You are using an older browser version. Please use a supported version for the best MSN experience.

NZ wool prices slump to 17-month low

NZN 16/09/2016 Tina Morrison

New Zealand wool prices fell to their lowest level in more than a year amid weak demand from China, the country's largest export market.

The price for fine crossbred wool slid at Thursday's North Island auction, with 35-micron fibre declining to $5 a kilogram from $5.25/kg at last week's South Island auction, $5.40/kg at the comparable North Island auction two weeks ago, and $6.55/kg a year ago, according to AgriHQ. That's the lowest level for the fibre since January 2015.

The price for strong crossbred wool also fell, with 39-micron fibre declining to $4.95/kg from $5.20/kg at last week's South Island auction, $5.30/kg at the comparable North Island auction two weeks ago, and $6.30/kg a year ago. That's the lowest level for the fibre since April 2015.

"We're seeing a change in price dynamics as a resulting factor of general soft China demand, compared with the last two years," said AgriHQ analyst Shaye Lee.

"Whereas China used to drive demand for wide variety of wool types, its tight market conditions led to them being more cautious. They are only wanting certain types of wool required to continue their core production processes. This target buying is leading to sporadic pick-up in the activity that's concentrated on certain wool types at certain times."

image beaconimage beaconimage beacon